Economist Warns of Possible Bitcoin Blow-Off Top at $123,000 Following Trump Victory
The 2024 US presidential election results indicate Donald Trump will secure a second term, defeating Kamala Harris. Following the announcement, Bitcoin reached an all-time high of $75,407 on Binance.
This surge is attributed to Trump's significant election promises, including establishing Bitcoin as a national strategic stockpile and enforcing a crypto-friendly policy. Experts predict a bullish outlook for Bitcoin due to Trump's victory, contrasting with concerns over a potential setback under Harris.
Economist Henrik Zeberg cautions that Trump's proposed economic policies may lead to a US recession, potentially resulting in a "blow-off top" scenario for Bitcoin and the broader crypto market. He highlights Trump's plan to replace certain taxes with tariffs as a catalyst for this downturn.
Is A Bitcoin Blow-Off Top Scenario Looming?
Zeberg draws parallels with historical events, particularly the Smoot-Hawley Tariff Act of 1930, which is believed to have intensified the Great Depression. He argues that similar tariff strategies could lead to a contraction in international trade and a global economic decline.
Despite these concerns, Zeberg forecasts a substantial but possibly short-lived increase in Bitcoin's price, targeting between $115,000 and $123,000. His analysis utilizes Fibonacci extension levels to project future price movements based on historical patterns.
The critical level to watch is the 1.618 Fibonacci extension at $114,916.16, which he suggests is likely the peak before a reversal. Other important resistance levels include:
- 0.382 at $77,437.88
- 0.618 at $85,205.47
- 1.0 at $107,435.71
- 1.27 at $123,148.19
Zeberg’s chart features an annotation questioning whether a 58% increase within three months is achievable, indicating expectations of rapid price growth consistent with historical trends.
As of the latest update, Bitcoin trades at $73,742.
